What is the Financial Assurance Program?
Federal and state rules require petroleum UST owners and operators to show that they have access to $1 million in case of a release or leak. This is referred to as demonstrating financial assurance or financial responsibility. If a UST owner or operator does not show financial responsibility, they are prohibited from receiving fuel into their USTs, and are not able to operate.
In 2023, the Washington State Legislature tasked the Washington State Pollution Liability Insurance Agency (PLIA) with establishing the State Financial Assurance Program (FA Program), Chapter 70A.545 RCW. The chapter describes the program’s statutory intent and purpose. The program rules found in Chapter 374-10 WAC describe the requirements and how the program is administered. The FA Program provides UST owners and operators with a financial responsibility option that meets the rules for operating a petroleum UST in the state.
Financial Responsibility Requirements for Underground Storage Tank Owners and Operators
Federal and state rules require petroleum UST owners and operators to show that they have access to $1 million in case of a release or leak. This is referred to as demonstrating financial assurance or financial responsibility.
If a UST owner or operator does not show financial responsibility, they are prohibited from receiving fuel into their USTs, and are not able to operate.
Most UST owners and operators in Washington meet this requirement with an insurance policy. Other ways to meet the requirement include:
- State-funded Assurance.
- Self-Insurance.
- Surety Bonds.
- Guarantees.
- Letters of Credit.
- Trust Funds.
- Standby Trust Funds.
How is the Financial Assurance Program Funded?
The Financial Assurance Program is funded by:
- The Petroleum Products Tax.
- Program Fees.
- Cost-recovery proceeds.
The Petroleum Products Tax is a tax on the wholesale value of petroleum at its first sale in the state. The tax is usually paid by distributors who purchase fuel to sell it to individual gas stations. The new program will also charge annual fees to program participants, and PLIA may recover the cost of cleanup from the liable person.
PLIA offers language interpretation services for our customers and partners at no charge. Please let us know when contacting us. To request materials in an alternative format, call PLIA at 800-822-3905. Relay Service 711, or TTY at 1-800-833-6388.